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Early warning of loan rate changes already in process

MarkMark
in Off-Topic
So I've been working with a lender on obtaining a loan for the purchase of a home. The home inspections revealed items which need attention (rough estimate $4-7K) that the seller may choose not to pay thereby cancelling the contract to sell/purchase. I have a locked in rate ( 2.75%/30-yr) but the lender is suggesting that I consider paying the costs myself because the costs would be a small fraction of what I'd lose in rate premium if I had to go shopping again.

He went on to say that because of the huge hit the bond market has taken the last few days rates are bad. He also said that they are neither quoting or taking any refinance applications at this time. Just a heads up.

Comments

  • beebee
    Why wouldn't the seller agree to these costs or at the very least split them with you?

    It's a great rate...hope it all works out for you.
  • MarkMark
    @bee - cheep dude, already claims he's losing money on the home. It's not my fault that he bought 2 other homes in the last month.
  • Old_JoeOld_Joe
    edited March 2020
    Look, if the home price is reasonable and the mortgage rate is great, what's the cost of the repairs... less than 1% ? You're doing fine... just buy the damned thing and forget it.
  • WABACWABAC
    Old_Joe said:

    Look, if the home price is reasonable and the mortgage rate is great, what's the cost of the repairs... less than 1% ? You're doing fine... just but the damned thing and forget it.

    Heck yeah. Based on what I know so far. That rate is practically giving money away free.

    We started at 7 and change, with PMI, when we bought our first. I wonder if we'll ever see that territory again.

    Only on our second. Paid for with the first. Had to cash in some IRA's to do it. But buying a house in Marin was probably a better bet than an index fund. Smartest thing we ever did.
  • Old_JoeOld_Joe
    edited March 2020
    @WABAC- same here in SF. 8.5%, as I recall, in 1975. Of course, income rates were a whole lot better also.
  • davfordavfor
    Yes. Lenders are overwhelmed with refi requests. They lack adequate staff to deal with it. So, supply and demand considerations are causing rates to increase...at least for the time being.
  • WABACWABAC
    Old_Joe said:

    @WABAC- same here in SF. 8.5%, as I recall, in 1975. Of course, income rates were a whole lot better also.

    SF has changed a lot since those days. The inlaw that was our first stop in town at 19th and Pacheco is probably going for 8 times the rent we paid back in October 1979.

  • MarkMark
    @ OJ - $4-7K repair estimates were on the low end. Actual costs may work out closer to $9K more in the neighborhood of 3% of the loan amount.
  • Bud
    Bloomberg had this article on how "Somehow,Some Way US Mortgage rates rise amid market turmoil"

    https://www.bloomberg.com/news/articles/2020-03-12/u-s-mortgage-rates-somehow-some-way-rise-amid-market-panic?srnd=premium



  • Old_JoeOld_Joe
    @Mark- Well, trying to make the seller absorb the entire amount may put his back up for no sale. If he's smart he'll also know the pressure on you re the mortgage approval, and try to pressure you that way. Try split 50/50 and hope for the best.
  • Old_JoeOld_Joe
    @Bud- see this MFO thread for more on movements in bond area, which is likely driving the mortgage scene also.
  • davidrmorandavidrmoran
    edited March 2020
    4 houses and almost a half-century ago, a realtor told me Do not ever lose a house you really like over a few thou.
  • CrashCrash
    We just sold, in 2019. The buyer wanted us to pay for the water/dampness repair. That house always had a problem with that stuff. I dunno what rate he got, but he went through the VA. We paid it, then the house price went up for him by the amount that we paid for the repair. He just did not want to worry about it. Or maybe he could not get the loan unless it was done ahead of time? Six of one, half-dozen of another. That location and zip code is not among the most coveted, anyhow.
  • MarkMark
    @Bud - just what my loan officer alluded to but thank you for the report.
    @david - that realtor was right, hopefully. It is a nice place.
    @OJ - good advice/input all around. Thank you.

    Everyone else, the seller is now paying for the critical items needed to gain insurability. I found some willing to provide "provisional" insurance long enough to proceed. That wasn't easy. Also it was hard to come to grips with paying for repairs which should have been attended to all along. I'll never understand letting your home fall apart around you. The VA is pretty strict with their lending requirements which is probably a good thing. Almost makes one long for the good old days when you didn't even have to prove you could afford your loan. Not.
  • Old_JoeOld_Joe
    @Mark- sounds like you have it under control. Congrats & best of luck. Hope you have many healthy and pleasurable years in the new home.

    OJ
  • MarkMark
    @OJ - Thank you and same to you. I still covet your R. river cabin though just so you know.
  • Old_JoeOld_Joe
    Heading up there for the weekend in about ten minutes! :)
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